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(Alliance News) - PZ Cussons PLC on Thursday said that trading remains in line with expectations and that its business in Nigeria remains strong despite "very high" inflation there.
The Manchester, England-based consumer goods company said trading since its last financial year ended on May 31 remained consistent with its outlook for the current year.
In late September the company - which makes hygiene, beauty and baby consumer products - predicted a fourth year of like-for-like revenue growth in the current year, running to May 31, 2024. PZ Cussons also anticipates adjusted operating profit within the range of current market expectations, or between GBP61.5 million and GBP68.2 million.
This would be down on last year. PZ Cussons recorded adjusted operating profit of GBP73.3 million in financial 2023 on GBP656.3 million in revenue.
For the six months ending November 30, PZ Cussons expects to report like-for-like revenue growth in the low single digits. It said this reflects strong growth in Australia, New Zealand and Nigeria, alongside a decline in Indonesia.
"Our Europe and Americas business is stable overall, with significantly-improving momentum in our UK washing and bathing brands offset by a decline in our Beauty business," PZ Cussons added.
The company also expects revenue growth and its operating margin to improve in the second half of the current year.
In Nigeria, PZ Cussons said trading during the current half year has continued to be strong, thanks to strategic progress made following its loss-making position in financial 2020.
PZ Cussons expects to report improved gross and operating profit margins for the current half year in Nigeria, "despite very high levels of inflation", while most of its brands have maintained or increased market share.
The firm's current cash balance in Nigeria is equivalent to around GBP80 million to GBP100 million. It also expects group gross debt to be reduced by around GBP20 million since the end of financial 2023.
Finally, PZ Cussons said the proposed transaction to delist and buy out the minority shareholdings of the Nigeria business is progressing as planned, and is forecast for completion before the end of the year.
The buy-out will be funded from local cash reserves, so PZ Cussons expects to have "only a minimal surplus cash position" in Nigeria by the end of financial 2024.
Shares in PZ Cussons were trading up 1.2% at 139.60 pence in London on Thursday morning.
By Emma Curzon, Alliance News reporter
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